Here’s why and how gaming will make the blockchain mainstream

It can take time for a new technology to take off and go
mainstream and it often takes a small additional something that is
lacking in the original concept. Radio broadcasting, for example,
started at the very beginning of the 20th century but didn’t go
mainstream before the 50’s, when the generalized use
of transistors allowed the proliferation of compact devices. The
Internet was already up and running in the 70’s, but all the network’s technical enhancements combined with the spread of microcomputers in the 80’s weren’t enough. The Internet really took off when the web browsers appeared around 1995.

The blockchain technology is only 10 years old and everyone
involved in the field (developers, believers, speculators, …) are still
wondering what it will take for the technology to go mainstream. We
think that gaming will be the gateway to cryptocurrencies for the
mainstream consumer and we will explain why and how.

Why gamers?

As of today, Bitcoin and the blockchain technology are quite well
ingrained in the mainstream culture. Chances are your mom heard about it
and even know that Bitcoin is some sort of money. However, the layman
is more likely to not be aware of the specifics and implications of
cryptocurrencies, and there is a reason for this: only a few people
truly needs the blockchain in their life to date. That situation may
change soon though, for more and more people are being exposed to
everyday issues that can be solved with it.

It appears that gamers are technologically educated enough to be the
ones who are in the front line for blockchain adoption. Firstly, not
only they know more than the average user about how The Internet works,
but they also are more likely to pay for things through it. Gamers spent
around $150 billion last year, a number which totally shatters the one
of the movie industry. And it is crazily increasing each year (2013 was $70.4 billion for gaming vs $35.9 billion for movies). That shift in the entertainment industry is also due to a shift in the way gamers consume. They don’t simply buy games anymore, they literally lead a virtual consumerist life, like Samantha Greenberg
points out by noting that “the initial purchase of a game is just the
beginning of a game’s monetization”. As of today, a more than
significant part of the gaming monetization occurs on the Internet, now constituting what we call the Virtual economy.
Secondly, gamers are smart. They learn and adapt to the new situations
in-game and on the Internet. They don’t only try to get virtually
better, they also know how to profit from new technologies to get a
better experience or to achieve various goals. That’s maybe why some of
the biggest players in the blockchain field were also video game masters
beforehand. Brock Pierce was a gamer, Vitalik was a gamer,
Kim Dotcom was a gamer, Elon Musk was a gamer and, actually, most of
today’s highly ranked developers are gamers. Therefore, you can be sure
that if the blockchain can improve the gaming experience, it will
quickly and easily be embraced by this non-stop growing population of
smart consumers whatever the technical and technological challenges it
entails.

Why would gaming adopt the blockchain?

Right now we can say that the gaming industry is taking an
interesting but weird turn. Free To Play games are monopolizing the
landscape while many players are complaining against the new wild
monetization methods (random chests, DLCs, lack of microtransactions,
etc.). Virtual worlds are getting bigger and bigger, allowing more and
more players to interact simultaneously, while many developers make the
choice to drastically limit players interaction (Starcraft 2,
Hearthstone, Artifact, etc.). In-game economies are booming while there
isn’t yet any global market to link them. Finally, it has never been so
easy to make, publish and promote games or content as an indie creator
while only a few platforms still dominate the market, allowing them to
dictate the political and economical rules.

Fortunately, the blockchain technology brings a lot of features that
will, in the near future, solve most of the paradoxical situations the
current gaming industry undergoes.

Using the blockchain technology in the gaming industry would
avoid such massive hacks thanks to data encryption, data
decentralization and the actual absence of the need that each user
shares his personal information with game publishers/platforms. Paying
with cryptos means they don’t need your name and address anymore, think
about that.

As a game developer, you may want to make some information
unforgeable and accessible to anyone. You may also want to allow your
users to converse while guarantying their total privacy. Both will be
easy to implement thanks to the blockchain technology.

2. Assets Ownership (NFTs)

Probably the most awaited and also the closest to mainstream adoption
in the list. Assets ownership is now a huge topic in the video game
industry. Some games, like Eve Online, Second Life or Entropia, involve
assets like homes, lands, ships or even planets that are sometimes traded for millions of dollars.
Unfortunately, those assets are ultimately the property of the company
owning the game. This fact leads to awful situations, like when Eve Online seized $620 000 worth of virtual assets because they didn’t like the gambling aspect of how they were earned.

With the advent of gigantic open worlds and virtual reality, the
virtual economy pledges to a bright future if something is done to
guaranty that crafted or purchased assets can be owned the same way as
cryptocurrencies: with a personal wallet protected by a private key. Your keys, your assets, not your keys, not your assets… And there is not that many gamers or game developers to convince about the merits of such a concept. A recent study
showed that 68% of gamers feel “they deserve to truly own the items
they buy” and 66% of game developers said “virtual items are a pivotal
component of their game’s monetization strategy and item value is being
suppressed by unnecessary publisher control”.

We are on the right path though. For a few months now, Non-Fungible Tokens (NFT) are in the spotlight. The hype really started with CryptoKitties a
year ago, but you can now play to a lot of decent games that use the
blockchain to provide true ownership of 100% unforgeable assets. EOS Knights
is an RPG game running on mobile and desktop computers which registers
all player actions on the EOS network. It is currently quite popular
because the game is funny, fast (which is still unusual for a full-blown
blockchain game) and also because you can earn EOS by playing it well. Gods Unchained
is a collectible card game similar to Hearthstone, ESL, Arena, etc. The
difference between Gods Unchained and the “traditional” digital card
games is that your cards are NFTs, so there is 1 Mythic Titan and if you
get it the blockchain seals the deal and prove your ownership: no one
can steal it from you, ban your account or anything preventing you to
access this card. There are many more examples but you get the idea.

3. Free and Globalized Market

Asset ownership is a thing, but to complete the dream of any gamer,
one should be able to freely buy and sell video game assets on a
globalized market. It is not only convenient for those who want to earn
money for the time they spent in-game, but also for more casual players
who invested in a game by buying various items and would like their cash
back in order to invest in another game. Also, the advent of a free
market for video game assets would put an end to that hostile attitude
big companies currently have toward second-hand markets.

4. Microtransactions

This is also a very important change that will occur with
cryptocurrencies being integrated into video games. Using tokens allow
developers to reward players depending on their actions. While it is
always possible to use centralized tokens (like the V-Bucks of Fortnite
that you could cash out), crypto-tokens ensure that every transaction is
definitive and every account untouchable. The possibility to audit the
ledger is a guarantee of transparency as well as a convenient proof of
users reputation for any work token based ecosystem.

5. Reduced Fees

Working with the blockchain at the core of your infrastructure allows
you to automate many sensible operations thanks to smart-contracts. The
more autonomous is your application, the less costly it is for devs and
players. Win-win!

How gaming will adopt the blockchain

So far we’ve seen some examples of games that integrate the
blockchain but no example of applications that allow several of the
mechanisms suggested above. Here are three examples of promising
projects that tackle the topic from various perspectives.

Wax

Peer-to-peer extension of the Opskins second-hand Counter-Strike skins marketplace, Wax
is kind of a wallet for NFTs with various security options. It allows
players to trade their crypto-assets without having to specifically go
on each marketplace of the games they play. For now, there are not many
tokens available (Cryptokitties, EtherBots, FishBanks, CryptoBarons) and
the solution lacks a more handy app, but it is a step in the right
direction for the trading of gaming assets.

Ultra

Ultra
is basically a Steam competitor in the decentralized world: they are
building a gaming platform by combining 1) proved gaming development
(SDK) and distribution technologies used by Zenimax, Bandai or Adobe
with 2) the EOS software
for the decentralized infrastructure. About the “proved gaming
development and distribution technologies” part, we can trust the team
which is composed by some big names in the video game industry: Mike
Dunn (CTO) was CTO @ Dell and Time Warner and is also a member of the
W3C. Edward Moalem (CSO) was Senior Director/Manager @ Apple and Google,
Chris Saad (Acting Head of Product) was Head of Product @ Uber,
Christian Rizea (Project Manager) was a game producer @ Ubisoft,
Microsoft and Bandai Namco. About the EOS part, they already partnered with some big BPs of the mainnet to build a secure and efficient autonomous blockchain.

As it is still under development, we only have limited information
about how exactly things will work out of the box, but we know for sure
that it is going to be a community platform allowing developers to build
and distribute small to AAA games, and players to interact in many
ways, create and curate content. There will be a market for tokens (NFT
or not) and the possibility to trade in-game as well as on the platform.
The fees for developers are planned to be super light and gamers will
be able to earn tokens by accomplishing various tasks like referring
friends, participating in beta tests and market studies, watching ads,
curating games, etc.

Loom is an Ethereum sidechain featuring a DPoS chain and a core that
supports Javascript, Phaser, Golang and Unity integration. We can say
that Loom is an EOS on Ethereum, which is weird but interesting. It is
interesting because it virtually raises the overall TPS and thus allows
platforms similar to Ultra on the Ethereum network. We are not yet
convinced Loom will be dominating the future since the EOS software has
everything already, but the way they dedicate their technology to game
development is truly fascinating. Their already available SDK is
allegedly powerful and already resulted in a few simple but working
applications (CryptoZombies.io, Zombies Battleground, DelegateCall).

Conclusion

Blockchain games and applications are the current main constituents of a blooming field that will decentralize the video game industry and allow what every gamer has always dreamed of. In the near future, living off gaming will not be restricted to a few anymore. Not only many more people will be paid for having fun, but useful tasks, accomplished by playing, will also be duly rewarded. As you may have understood, it is less a matter of why or how than a matter of when for gaming to adopt blockchain as a tool for developers and gamers to emancipate themselves from the economical constraints of the current distribution model.